CAF-7 · Chapter 8 · Question 2 of 15
In a Mudarabah contract, if the business suffers a financial loss due to normal business risks (and not due to the manager's negligence), who bears the financial loss?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) The Rabb-ul-Maal (Capital Provider) only
Explanation
In Mudarabah, the financial loss is borne entirely by the capital provider (Rabb-ul-Maal). The manager (Mudarib) only loses the time and effort they invested in the project.
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